NTPC Receives 13 Bids For Stake Sale In Green Energy Arm; Winners To Be Announced By Month-end

The green energy arm of NTPC, NGEL, has received 13 bids for the stake sale majorly global asset managers and financiers.

NTPC, India's largest power utility, is looking to sell a minority stake in its green energy arm to raise up to Rs 2,000 crore.

The expression of interest (EoI) for 5-10 per cent stake sale in NGEL was issued in June 2022, and the winners will be finalised by the end of September.

Among the ones who have submitted bids are Canada Pension Plan Investment Board (CPPIB), Brookfield, Abu Dhabi's TAQA, National Investment and Infrastructure Fund (NIIF), Malaysian oil and gas company Petronas and global steel major ArcelorMittal.

The company is also expected to list the NGEL in the coming financial year. Senior executives did not indicate the stake proportion but said the company was aiming for the range of 10-15 per cent but can take it up to 26 per cent.

Asset Sale

The stake sale of NGEL is a part of the asset monetisation target of NTPC, pegged at Rs 15,000 crore for three years.

Along with the listing of NGEL, NTPC is also looking to offload its stake in two companies - NTPC Vidyut Vyapar Nigam ltd (NVVN), and North Eastern Electric Power Corporation ltd (NEEPCO).

NTPC Vidyut Vyapar Nigam Ltd. was formed by NTPC in 2002, as its wholly owned subsidiary to tap the potential of power trading in the country and is among India's top power trading companies.

NEEPCO was incorporated in 1976 to plan, investigate, design, construct, generate, operate and maintain power stations in the North Eastern Region of India.

NTPC acquired 100 per cent stake in NEEPCO in March 2020, earlier owned by the central government, to contribute to the divestment target of the centre.

As part of the same plan, NTPC is also looking to exit from its joint venture with steel major SAIL, NTPC-SAIL Power Company Ltd. However, sources said SAIL is reluctant to take this exercise forward.

Existing Capacity and Renewable Energy Expansion

The total installed capacity of the company is 69.5 GW which includes 57 GW of Coal based plants, 6.5 GW of gas based plants, 3.7 GW Hydro capacity and 2.3 GW of renewable capacity.

The installed RE capacity of the energy major crossed 2 GW in June this year with commissioning of the country's largest floating solar PV project of 92MW on the reservoir of Kayamkulam Gas Power Station in Alappuzha District, Kerala.

The power conglomerate has 3.9 GW of renewable capacity under implementation and execution and another 4.9 GW of RE capacity under tendering process, which will further bolster its green energy portfolio.

With 23 coal-based power stations, NTPC is the country's largest thermal power generating company. The company has a coal based installed capacity of 48,120 MW.

NTPC became the first Energy Company in the energy domain in India to declare its Energy Compact goals as part of UN High-level Dialogue on Energy (HLDE).

By 2032, the company plans to have 60 GW capacity through RE sources, constituting nearly 45 per cent of its overall power generation capacity.

NGEL

NTPC began its foray into the renewable energy sector in 2004 through distributed generation projects for remote villages for which grid supply was either technically not feasible or commercially not viable.

To accelerate the renewable energy growth of the company and increase the green footprint across the country, offshores and overseas, the NTPC Board, on 9 May 2020, approved the formation of a wholly owned subsidiary exclusively for RE business.

On 7 October 2020, NTPC Renewable Energy Ltd. (NREL) was registered with the registrar of companies.

NREL has now been made part of an umbrella entity, NTPC Green Energy Ltd (NGEL), which was incorporated as a wholly-owned subsidiary of NTPC with the Registrar of Companies on 7 April 2022.

The new entity is expected to become the main vehicle for NTPC's clean energy initiative and will also execute projects on green fuels, battery storage and energy efficiency.

All future joint ventures will be formed under NGEL.

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